States not in a position to stop FDI in retail: BJP

NEW DELHI: BJP on Monday accused the government of playing a 'policy fraud' on the country and argued that it has no right to make bilateral investment agreements conditional to approval of states. The Centre had on Friday cleared 51% FDI in multi-brand retail but left it to state governments to take a call on where such stores should be permitted.

BJP, which has declared that states where it is in power would oppose entry of retail giants, said India has signed bilateral investment agreements with 82 countries which said no conditions can be put on foreign investors. The party said India's doors cannot be opened in parts.

"India has entered into bilateral investment agreements with 82 countries. The basic feature of these bilateral treaties is that they accord national treatment to foreign investors. The effect of this provision is that India cannot put any condition, on foreign investors, which is not applicable to domestic investors," BJP spokesperson Prakash Javadekar told reporters here. He said the basic features of these bilateral treaties accord national treatment to the foreign investors and that this would mean that the government cannot put any condition on foreign investors which were not applicable to domestic investors.

BJP argues that the government was misleading by saying that it was leaving it open to states whether to agree to allowing multi-brand retail stores. Citing a Kerala high court ruling which had struck down the Left Democratic Front government's attempt to stop corporate retailers by disallowing them from setting up shop, he asked if states had the real right to reject entry of FDI retail chain. "As there are no restrictions on local retail chains, the restrictions on foreign chains by the states would be declared by the courts as void... This action of the state government was struck down by the Kerala high court," he said.

Dubbing it as an ill-conceived decision, Javadekar also said that when any concession was given to foreign countries, there had to be a negotiated settlement that was beneficial for the country and "many western countries are interested to access the huge Indian market via multi-brand retail chains."

Besides all seven BJP-run states, JD(U) ruled Bihar, Samajwadi Party-ruled Uttar Pradesh and Tamil Nadu, where AIADMK is in power, have also said they will not implement FDI in multi-brand retail. West Bengal, ruled by Congress' ally Trinamool Congress has also said no to it. Going by the 2011 census, there are 37 cities with more than one million population spread over 11 states ruled by the parties opposed to the decision. Against this, there are only 19 cities which fall in states ruled by Congress and some of its allies which are not opposed to allowing entry of retail giants.

The Opposition has upped its ante against FDI in multi-brand retail, ahead of the September 20 country-wide strike. NDA as well as Left parties, SP, TMC, JD(S) and others have given calls for a country-wide strike on the same day. BJP queried why the government was in a 'hurry' to take such a decision. "Even many cities in the US are not allowing Walmart like chains to open stores in their cities because of the fear of losing many existing jobs. Every country puts its own restrictions in the best national interest. The UPA government has not done any such thing. Has the adverse comments in western media on our PM did the trick," Javadekar asked.

Asked if there were apprehensions in the party that states which turned down retail giants would have a disadvantage, BJP spokesperson Nirmala Sitharaman said this question did not arise as the government cannot enter bilateral agreements with conditions.